Capital Power extends its Arlington Valley tolling agreement to 2038 and increases its summer capacity by 35 MWs, enhancing reliability and long-term value

Core Viewpoint - Capital Power has extended its summer tolling agreement for the Arlington facility with an investment-grade utility, increasing the contract duration to 2038, which is expected to enhance revenue and growth opportunities in the U.S. southwest [1][10]. Group 1: Contract and Financial Impact - The new agreement extends the existing contract by 7 years, providing a total of 13 years of contracted revenue [10]. - The facility is projected to achieve an adjusted EBITDA uplift of approximately US$70 million annually by 2032, which includes contributions from a capacity uprate [2][10]. - The uprate is expected to add around US$8 million per year to adjusted EBITDA starting in 2027 [2]. Group 2: Facility and Capacity Expansion - The Arlington facility, a 600 MW natural gas-fired combined cycle plant, will undergo a capacity uprate of 35 MW to meet Arizona's peak demand, with 10 MW added in 2026 and 25 MW in 2027 [3][4]. - This expansion is crucial for enhancing the reliability of power supply during peak summer demand in Arizona [4]. Group 3: Strategic Benefits and Market Position - The toll structure allows for flexibility during non-summer periods, enabling the facility to capture incremental energy value and capacity value in CAISO and the Desert Southwest starting in 2027 [5]. - Capital Power is recognized as North America's fifth-largest natural gas Independent Power Producer (IPP), reinforcing its commitment to reliable energy solutions across the continent [6].